Technovation 21 (2001) 253–261www.elsevier.com/locate/technovation

Lessons learned about technology transfer

Everett M. Rogers*, Shiro Takegami , Jing YinDepartment of Communication and Journalism, University of New Mexico, Albuquerque, NM 87131-1171, USA

Received 9 March 2000; received in revised form 23 April 2000; accepted 29 April 2000

Abstract

The present paper derives lessons learned about effective technology transfer from research on the technology transfer processin New Mexico over the past several years. Technology transfer from national R&D laboratories and from research universitiesprovides the main basis for economic growth by metropolitan regions in the United States. New Mexico is (1) technology-richbecause of Sandia National Laboratories, Los Alamos National Laboratory and the University of New Mexico, and (2) entrepreneur-friendly. High-technology spin-offs are a particularly effective means of technology transfer. The process of technology transfer isa difficult type of communication, and demands trained and skilled personnel, adequate resources, and organizational and otherreward/incentive structures. 2001 Elsevier Science Ltd. All rights reserved.

Keywords:Technology transfer; Spin-offs; High technology; Regional development

1. Introduction

Many metropolitan regions around the world look attechnopolises like Silicon Valley in Northern California;Austin, Texas; the Route 128 complex near Boston,Massachusetts; Tsukuba Science City in Japan; Cam-bridge, England; and Bangalore and Hyderabad, India;and may seek to become more like them. The technologycities create jobs and wealth, and thus are a mechanismfor economic development. For example, in Silicon Val-ley, undoubtedly the most widely known technopolis inthe world, an average of 63 new millionaires were cre-ated each day during 1999 (Nieves, 2000). An analysisof the rate of economic growth by US metropolitan areasduring the 1990s found that two-thirds of the increase ineconomic growth was due to high-technology industry,fueled in turn by spin-off companies from research uni-versities, federal R&D laboratories and corporate labora-toriess (DeVol, 1999). So, an important policy questionhas become how metropolitan regions can harness suchtechnology transfer for their economic development. Theanswer may lie in an improved understanding of thetechnology transfer process.

* Corresponding author. Tel.:+1-505-277-7569; fax:+1-505-277-4206.

E-mail address:erogers@unm.edu (E.M. Rogers).

0166-4972/01/$ - see front matter 2001 Elsevier Science Ltd. All rights reserved.PII: S0166-4972 (00)00039-0

The purpose of the present paper is to summarize les-sons learned about technology transfer over the past sev-eral years of research on: (1) CRADAs (cooperative R&D agreements) linking Los Alamos National Laboratory(LANL) with private companies (Rogers et al., 1998);(2) spin-offs from LANL and Sandia National Labora-tories (SNL) (Carayannis et al., 1998), and from researchcenters at the University of New Mexico (UNM)(Steffensen et al., 1999; Rogers et al., 1999a); (3) therole of entrepreneurs’ individualistic and collectivisticcultural values in high-tech spin-offs in New Mexico andSingapore (Rogers et al., 1999c); (4) the technologytransfer effectiveness of 55 research centers at UNM(Rogers et al., 1999a; Steffensen et al., 1999); and (5)the technology transfer effectiveness of 132 researchuniversities in the United States as they move toward anera of “academic capitalism” (Slaughter and Leslie,1997) in which the university becomes increasinglyinvolved in the business aspects of transferring research-based technologies (Rogers et al., 1999b).

2. Prospects for a New Mexico technopolis

New Mexico is a large state in area (ranking fifthamong the 50 states), small in population (only 1.5million people, half of whom reside in the Albuquerquearea), and poor (50th of the 50 states in per capita

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income). Albuquerque is remote from the metropolitancenters of capital and from consumer markets in theUnited States.

Despite these handicaps, state leaders and city officialsin Albuquerque are strongly committed to creating atechnopolis (technology city) in Northern New Mexico.Technology transfer is regarded as a crucial factor foreconomic development in New Mexico. The state ranksfourth among the 50 states in federal and university R&D performance. The New Mexico Legislature created avariety of pro-technology transfer policies in recentyears, such as by allowing venture capital firms to drawon the state’s reserve funding (including that earned bya state severance tax) in order to provide up to half of theinvestment in new high-tech companies in New Mexico.LANL and SNL actively encourage high-tech spin-offsand utilize other mechanisms of technology transfer.Numerous technology transfer institutions seek to facili-tate the entrepreneurship process. Particularly importantis the Technology Ventures Corporation (TVC), whichis funded by Lockheed Martin, the aerospace companythat manages SNL. UNM doubled its sponsored researchfunding over the past decade (to about $200 millionannually), a faster rate of increase than that of any otherUS research university in this time period (Rogers et al.,1999a). Several of UNM’s 55 research centers play anactive role in technology transfer, including facilitatingspin-offs. So technology transfer activity is increasinglyunderway in New Mexico, as Albuquerque movestoward becoming a future technology city.

Spin-offs can be a particularly effective means oftechnology transfer, leading to job and wealth creation.But the number of spin-offs occurring in a region is usu-ally slow at first until a certain point (the critical mass)is reached, when the rate of spin-off activity begins toincrease exponentially (Rogers, 1995). The availabilityof ample technology in a region is a necessary but insuf-ficient factor in the development of a technopolis (muchof the technology from federal weapons laboratories likeSNL and LANL is defense-related and thus is parti-cularly difficult to commercialize). Technology transferfacilitating organizations like TVC, several incubatorsand research parks, and the offices of technology com-mercialization at SNL and LANL, can speed up the pro-cess of getting to critical mass in the growth of high-tech spin-offs.

New Mexico provides a useful environment in whichto understand the technology transfer process as a meansof economic development, in part because, like manycities in the world, the Albuquerque area is at a fairlyearly state of high-tech development and faces importantbarriers to be overcome.

3. Technology transfer

Technologyis information that is put into use in orderto accomplish some task (Eveland, 1986).Transfer isthe movement of technology via some communicationchannel from one individual or organization to another.A technological innovationis an idea, practice or objectthat is perceived as new by an individual or some otherunit (Rogers, 1995). Therefore,technology transferis theapplication of information (a technological innovation)into use (Gibson and Rogers, 1994). The technologytransfer process usually involves moving a technologicalinnovation from an R&D organization to a receptororganization (such as a private company). A technologi-cal innovation is fully transferred when it is commer-cialized into a product that is sold in the marketplace.So technology transfer is a special type of communi-cation process.

Technological innovation–development is oftendescribed as a linear process, from basic research, toapplied research, to development, to commercialization,to diffusion, and to the consequences of the innovation.A linear model of the innovation–development processmay not fully take into account external environmentalfactors, such as market demand or regulatory changes,which may influence the technological innovation pro-cess. The technology transfer process spans the stagesfrom R&D to commercialization and beyond, but withparticular focus on the interface between R&D (often bya university research center, a corporate unit, or by agovernment laboratory) and commercialization (oftencarried out by a private company).

3.1. Technology transfer mechanisms

Technology transfer occurs via various channels ofcommunication.

1. A spin-off is a new company that is formed (1) byindividuals who were former employees of a parentorganization, and (2) with a core technology that istransferred from a parent organization (Rogers andSteffensen, 1999). Spin-offs thus represent the trans-fer of a technological innovation to a new entrepren-eurial company that is formed around that technologi-cal innovation. Generally, a spin-off neighbors withits parent organization, especially, as in Northern NewMexico, when they are located in an area with anattractive quality-of-life.1 As more and more spin-offsoccur, including spin-offs of spin-offs, an agglomer-ation of high-tech companies is formed, eventually

1 Another reason for the agglomeration of spin-offs is that venturecapital does not travel far, due to the need for the venture capitalist toremain in almost daily contact with the spin-offs in which the venturecapitalist has invested.

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resulting in a technopolis. A spectacular demon-stration of this agglomeration process of high-techspin-offs occurred in Austin, Texas in the late 1980sand 1990s.

2. Licensing is the granting of permission or rights tomake, use and/or sell a certain product, design or pro-cess, or to perform certain other actions, by a partythat has the right to give such permission (Anon.,1995). A licensing fee is usually paid in exchangefor acquiring a technology license. Licensing royaltiesmay earn considerable income for a research univer-sity or for a national R&D laboratory. We believe thatthe increasing emphasis on technology licensing roy-alties by US research universities may be trans-forming these institutions into “entrepreneurial uni-versities” pursuing a path toward academic capitalism(Slaughter and Leslie, 1997). The University of NewMexico now has an active office of technology licens-ing with a staff of four professionals who are organi-zationally part of the University’s Science and Tech-nology Corporation, a research foundation that alsomanages the university’s real estate and its incubatorfor high-tech spin-offs.

3. Publicationscan also be a means of technology trans-fer. Articles published in academic journals are themost frequently used means of technology transfer,as reported by university scholars. Unfortunately,journal articles are mainly written for fellow scien-tists, rather than for potential users of a research-based technology. Thus scholarly articles are not aneffective means of technology transfer, although theyare the most frequently cited technology transferactivity by university-based research centers (Rogerset al., 1999a).

4. Meetings involve person-to-person interactionthrough which technical information is exchanged. Inthe late 1990s, three networks/associations wereorganized in New Mexico to facilitate information-exchange and entrepreneurial activity: (1) BiomedicalTuesday, (2) the New Mexico Optics Industry Societyand (3) the New Mexico Information and SoftwareAssociation. Each association attracted from 50 to 75entrepreneurs, venture capitalists and others to theirmonthly meetings.

5. Cooperative R&D agreements (CRADAs)areintended to transfer technologies from federal R&Dlaboratories in the United States to private companieswho collaborate in R&D with the federal laboratory(Rogers et al., 1998). CRADAs are comprehensivelegal agreements for sharing research personnel,equipment and intellectual property rights in jointgovernment–industry research between federal R&Dlaboratories and private companies. Because federalR&D laboratories and private companies do not sharea common organizational culture, they face certaindifficulties in their collaboration in CRADAs (Rogers

et al., 1998). Larger corporations are more likely tobe involved in CRADAs with federal laboratories inNew Mexico than are smaller companies, andCRADA partners tend to be out-of-state.

4. Spin-offs

A spin-off is a technology transfer mechanismbecause it is usually formed in order to commercializea technology that originated in a government R&D lab-oratory, a university research center or a private R&Dorganization. A high rate of establishing spin-off compa-nies is characteristic of technopolises like Silicon Valley,Austin, Route 128, Cambridge, Tsukuba Science City(Dearing and Rogers, 1990) and Bangalore (Singhal andRogers, 2000). In fact, spin-offs are the main mechanismfor the rapid growth of each of these technopolises.

We examined the high-technology spin-off processthrough which a new company is formed from a parentorganization, in the case of (1) seven spin-off companiesin New Mexico and Japan (Carayannis et al., 1998), and(2) six spin-offs from the University of New Mexico(Steffensen et al., 1999). An investigation of 30 spin-offs, mainly from LANL and SNL, is presently beingconducted. Support from the parent organization, suchas by providing venture funding, business managementadvice, building space or other needed resources, isespecially helpful to the spin-off company. In somecases, facilitating organizations support a new spin-offby providing resources and know-how.

Various support organizations have been establishedin New Mexico to assist high-tech entrepreneurs in thedifficult process of formulating a business plan,obtaining venture capital, and getting their new businessunderway. For example, the Technology Ventures Cor-poration and the Business Technology Group (BTG), acollective of three Albuquerque-based incubators, playimportant roles in supporting spin-off companies. SmallBusiness Innovation Research (SBIR) funding from fed-eral research agencies is particularly important for high-tech spin-offs in New Mexico. These companiesreceived a total of $18 million in SBIR funding in 1998.We found that the SBIR funding, although typically inmodest amounts per grant, often helped keep a spin-offalive until it could attract investment from a venturecapitalist.

Our research on spin-offs began by identifying 70 newhigh-tech companies that had spun off the federal R&Dlaboratories or the University of New Mexico during the1990s. This list, believed to be fairly exhaustive, wasobtained through a snowball technique beginning withthe technology transfer offices of the two federal R&Dlabs and the various support organizations assisting newventures in New Mexico, such as the Technology Ven-

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tures Corporation (TVC), business incubators and theNew Mexico Native American Business DevelopmentCenter (NMNABDC).

The federal R&D laboratories in New Mexico haveinstituted entrepreneurial leave policies, which haveincreased the number of their spin-offs. We found thatmost parent organizations support their spin-offs, or atleast do not try to destroy them. Several venture capitalfirms have moved to New Mexico in recent years. Spin-off facilitating organizations like TVC play an importantrole in assisting high-tech spin-offs.

We investigated three spin-off companies, onefounded by a Native American, one by a Hispanic andone by a Singaporean (in Singapore), in order to deter-mine whether entrepreneurs with collectivistic cultures,in which the collectivity’s goals are more important thanthe individual’s (Rogers and Steinfatt, 1999), are disad-vantaged in spinning off a new firm compared withentrepreneurs with individualistic cultures, in which theindividual’s goals are more important than the collectivi-ty’s (Rogers et al., 1999c). The ethnic make-up of NewMexico’s population is 51% European AmericanAnglos, 39% Hispanics and 9% Native Americans.People with more collectivistic cultures (for example,many Hispanics and Native Americans) make up a con-siderable share of the state’s population. Is collectivisma barrier to individual entrepreneurship?

One example of a spin-off company from a federalR&D laboratory is Beta Corporation International, aminority-owned international environmental, engineer-ing and management consulting company founded by DrEvaristo J. Bonano. He was born in Puerto Rico, andearned his Masters and Ph.D. degrees from Clark Uni-versity in 1980. After employment for several years atthe Xerox Corporation, Bonano moved to New Mexicoto work for Sandia National Laboratories. At SNL, heconducted R&D on nuclear waste clean-up and otherenvironmental problems. This research experience pro-vided Bonano with the technology and business contactsto start his own company in 1992. Beta’s original marketniche was environmental risk assessment, with anemphasis on radioactive waste disposal. Bonano’s ethnicbackground is a special advantage in that Spanish is hisnative tongue, and his bilingual fluency is beneficial inBeta’s business projects in Latin America and Spain.Computer software for environmental engineeringgradually became Beta’s core technology. By mid-1999,Beta had 50 employees, and was operating in a dozencountries.

We conclude that collectivistic cultural values do notseem to be a strong deterrent to launching a high-tech-nology spin-off, and may provide certain advantages,such as when the collectivity (such as family members)provides capital.

5. Technology transfer from university-basedresearch centers

A research centeris a university-based organizationwhose purpose is to conduct scholarly investigations ofan interdisciplinary nature, usually with financial supportfrom private companies and other organizations outsidethe university (Rogers et al., 1999a). So a university-based research center is aboundary-spanner, defined asa unit that exchanges information between an organiza-tion and its environment. Most research centers conductmultidisciplinary research drawing on scientific expertisefrom two or more academic disciplines.

In recent years, the University of New Mexico hasrisen through the ranks of US research universities interms of its total amount of external research funding.Some 85% of this research (as measured by funding) isconducted by the 55 research centers at the Universityof New Mexico (the reminder is conducted by principalinvestigators, each in their academic department). UNMpursued an aggressive policy of launching multidiscipli-nary research centers, especially in the early 1990s, inorder to expand its functioning as a research university.

One example of UNM’s many research centers is theCenter for High-Technology Materials (CHTM), whichwas initiated by the State of New Mexico in 1983 asone of five centers of technical excellence. The originalmission of CHTM was to conduct research on optoelec-tronics, specifically photonic-type applications and diodelaser fabrications. After CHTM became a SEMATECHCenter of Excellence in 1988, CHTM devoted increasingresearch attention to semiconductor materials. CHTM isone of the largest research centers at UNM, with 91employees including faculty, undergraduate and gradu-ate students, and staff. CHTM’s annual budget is about$6.5 million. CHTM funds half of the total number ofresearch assistantships in the Department of ElectricalEngineering and Computer Engineering at UNM, as wellas several research assistantships in the UNM Depart-ment of Physics. This research center is located in itsnew building on the UNM Science and TechnologyCampus. Six start-ups have spun out of CHTM(Steffensen et al., 1999).

Our study of UNM’s 55 research centers showed that:(1) the director’s role is particularly important in a uni-versity-based research center; (2) most research centersrecognize technology transfer as one part of their mis-sion; and (3) the main means of technology transferreported by research centers are scientific journal art-icles, but such publications are not very effective in con-veying research findings to non-scientist audiences(Rogers et al., 1999a). We identified 19 spin-off compa-nies from six of the 55 research centers (Rogers et al.,1999a). Five or six of the 55 research centers, charac-terized by large budgets and conducting multidisciplin-ary research in engineering or the life sciences, were

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most active in invention disclosures, patents and tech-nology licensing.

6. Technology transfer from research universities

A research universityis a university whose main pur-poses are (1) to conduct research, and (2) to train gradu-ate students in how to conduct research. The firstresearch universities developed in Germany, like Got-tingen (in 1737) and the University of Berlin (in 1810).The idea of the research university spread to the USA,first to Johns Hopkins University (in 1876) and to ClarkUniversity (in 1890), and then to Stanford University (in1891) and the University of Chicago (in 1892). Today,several hundred US universities are consideredresearch universities.

Research universities in the United States play anincreasingly important role in technology transfer, andare generally considered to be relatively more effectivein transferring technology than are federal R&D labora-tories. The Bayh–Dole Act of 1980 delegated theresponsibility for the transfer of technology resultingfrom federally funded research at universities from thefederal government to the universities. University officesof technology licensing were created and becameimportant gatekeepers and boundary-spanners in thetechnology transfer process. Today, almost all USresearch universities have an office of technology licens-ing, which typically earns technology licensing royaltiesfor the university. However, at most of the 131 researchuniversities responding to the annual survey conductedby the Association of University Technology Managers(AUTM), the office of technology licensing is relativelysmall, with only two or three professional staff members(Massing, 1998).

The rapid spread of offices of technology licensing inthe 1980s and 1990s was encouraged by: (1) the Bayl–Dole Act, which gave the intellectual property rights fortechnologies from federally funded research to univer-sities; (2) the growing importance of life scienceresearch (especially in biotechnology) in creating patent-able technologies; and (3) the attraction of having a “bigwinner” technology that will earn millions of dollars.Examples of such big winners are the $160 million thatMichigan State University has earned from two cancer-related inventions, cisplatin and carboplatin(Blumenstyk, 1999), the $37 million that the Universityof Florida has earned from the sports drink Gatorade,the $27 million that Iowa State University has been paidfor the fax algorithm, and the $143 million earned byStanford University for the recombinant DNA gene-splicing patent (Odza, 1996). A “big winner” can domi-nate the total technology royalties at a research univer-sity; for example, $18 million of Michigan State Univer-sity’s $18.3 technology royalties in fiscal year 1998

came from the two cancer-related drugs (Erbisch, 1999).Pursuit of a “big winner” technology provided onemotivation for the rapid diffusion of university officesof technology licensing, and, more generally, for themovement of US universities toward academic capi-talism,2 which is also indicated by a university having aresearch foundation, a technology incubator for start-ups,a venture capital fund, a research park, and for takingan equity position in its start-ups.

The nature of technology transfer from research uni-versities in the United States is a process through which(1) research expenditures, (2) lead to research activities,(3) that lead to invention disclosures, (4) that lead topatents applied for and granted, (5) that lead to activetechnology licenses, (6) which lead to technologylicenses capable of generating income, (7) which lead totechnology royalties and to start-ups, and (8) thus to jobsand wealth creation (Fig. 1).

During the fiscal year (FY) 1997, technology licensingoffices at 132 US research universities were issued 2239patents, executed 2707 new technology licenses, had 258start-up companies, and earned a total gross income of$483 million (Massing, 1998). The Association of Uni-versity Technology Managers (AUTM) estimated that$28.7 billion of US economic activity, supporting245,930 jobs, could be attributed to academic licensingactivity in FY1997 (Massing, 1998). University officesof technology licensing are important gatekeepers andboundary-spanners in the technology transfer processthrough which university research, funded at $19.9billion in FY1997, is communicated to potential users,mainly private companies. From FY1996 to FY1997,most of the above indicators of technology transfer fromUS research universities increased by 15 to 30%(Massing, 1997).

The Stanford University Office of Technology Licens-ing (OTL) earned an income of $52 million from tech-nology licensing in 1997, which represented 13% of theUniversity’s total research funding. The OTL staff of 25professionals handled 248 invention disclosures, filed185 patents, and managed 272 licensed technologiesyielding income in 1997 and over 1044 active tech-nology licenses (Massing, 1998; Sandelin, 1994). Themission of OTL “is to promote the transfer of Stanfordtechnology for society’s use and benefit while generatingunrestricted income to support research and education.”

MIT’s office of technology licensing, with a staff of27, had 360 invention disclosures, filed 200 new patents,was issued 134 patents, had 17 start-up companies, andearned $21.2 million in technology license income(Massing, 1998). MIT’s 205 active patent licenses as of

2 Academic capitalismis defined as the degree to which a researchuniversity becomes involved in the transfer of university-conductedresearch into commercialized products and services.

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Fig. 1. The process of technology transfer from a research university.

1993 were associated with almost one billion dollars ofinvestment and created 2000 jobs (Pressman et al.,1995). Spin-off companies from MIT accounted for only35% of technology licenses, yet created 77% of theinduced investment and 70% of the employment. Again,we see the importance of spin-offs as a mechanism oftechnology transfer.

In previous research, scholars used a number of differ-ent indicators to measure different aspects of technologytransfer effectiveness (for example, Bozeman, 1994;Geizer and Clements, 1995; Muir, 1993; O’Keefe, 1982;Sandelin, 1994; Spann et al. 1993, 1995; Tornatzky etal., 1995; Trune, 1996). We constructed a compositemeasure of technology transfer effectiveness for USresearch universities based on the six steps in the tech-nology transfer process (see Fig. 1). This measure equ-ally weights six indicators of technology transfer effec-tiveness: (1) the number of invention disclosures, (2) thenumber of US patent applications filed, (3) the numberof technology licenses and options executed, (4) thenumber of technology licenses and options yieldingincome, (5) the number of start-up companies spun offthe university (based on a technology licensed by theuniversity’s office of technology licensing), and (6) thetotal amount of technology licensing royalties earnedper year.

According to their technology transfer effectivenessscores, the University of California System, Stanford Uni-versity and MIT are among the 131 US research univer-sities with the highest technology transfer effectivenessscores. Another research university, with a technologylicensing office staff of only one half-time person, mightonly have a dozen invention disclosures, a couple of pat-ents and technology licenses, no spin-offs, and earn licens-ing royalties of $20,000 in FY1997. Why are someresearch universities much more effective in technologytransfer activities than are others? Research universitiesthat are relatively more effective in technology transfer arecharacterized by: (1) more research resources, such as the

number of faculty, student enrolment and R&D expendi-tures; and (2) a stronger commitment to technology trans-fer, indicated by the support of university administrators,the number of staff members in the office of technologylicensing, etc. (Rogers et al., 1999b).

Many research universities are becoming growthengines for regional economic development through thetechnology transfer process (DeVol, 1999). The Univer-sity of New Mexico ranks 88th among the 131 researchuniversities in the United States in technology transfereffectiveness. In the mid-1990s the University estab-lished a Science and Technology Corporation to (1)manage real estate and technology transfer activitiesconnected with the Technology Park, and (2) overseethe University’s office of technology licensing, whichbecame energized in the late 1990s. The University isthus involved in facilitating technology transfer such asthrough incubators, the research park, etc. One role inthis technology transfer process is provided by the Uni-versity’s office of technology licensing.

7. Encouraging technology transfer in New Mexico

New Mexico is located in a relatively remote part ofthe United States. It does not have adequate naturalresources or population (that is, customers) to attract cer-tain large businesses. New Mexico ranks first in per cap-ita funding received from the federal government, butranks last among the 50 states in per capita income.

On the other hand, New Mexico is particularly tech-nology-rich. Two large national R&D laboratories, theUniversity of New Mexico and numerous spin-offs cre-ate a technology-rich environment in northern NewMexico. The state is also an entrepreneur-friendly sys-tem. The Business Technology Group coordinates sev-eral incubators in Albuquerque, including the Albu-querque Technology Incubator and the LovelaceResearch Institute’s Incubator. The Technology Ven-

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tures Corporation, five venture capital companies andother support organizations also help entrepreneurs inthe daunting process of starting a new business and inattracting venture capital.

Technology transfer is an important mission of all 700federal R&D laboratories in the US in the post-Cold Warera. Both Sandia National Laboratories and Los AlamosNational Laboratory carry out technology transferthrough their offices of technology commercialization.Both have an Entrepreneurship Program that encouragesresearchers to start up a new business while on leavefrom their laboratory position for two or three years(without pay), and with the option to return to employ-ment at their laboratory.

The Technology Ventures Corporation (TVC) wasfounded as a non-profit organization in 1993 by the Mar-tin Marietta Corporation, as part of their contract to man-age Sandia National Laboratories (this aerospace com-pany later merged with Lockheed). Lockheed Martinpresently funds TVC at about $1 million per year. Themission of TVC is to identify technologies with com-mercial potential (especially from SNL), develop busi-ness capabilities, and seek venture capital for starting uphigh-tech companies. TVC is a non-profit organizationthat takes no fees or joint ownership in the new compa-nies that it helps start.

The typical annual process conducted by TVC forassisting spin-off companies is: (1) to accept appli-cations, including a business plan, from candidate spin-off companies in November of each year; (2) to selectabout a dozen spin-offs by mid-January; (3) to form anadvisory group for each spin-off company, consisting ofa management specialist, a venture capitalist, a market-ing expert and a TVC employee, who assist the spin-off’s entrepreneurs in sharpening their business plan; and(4) to conduct the New Mexico Equity Symposium inmid-May in Albuquerque, attended by a number of ven-ture capitalists. Each year, about 20 to 30% of the dozennew spin-off companies are successful in obtaining ven-ture funding through the TVC’s activities.

After five years of operation, TVC estimated that itbrought $134 million in investment to the state of NewMexico, and created 32 spin-offs and over 1270 jobs(TVC, 1998). TVC is one reason for the increasing rateof technology transfer through spin-offs in New Mexico.

An example of a successful spin-off that was facili-tated in the start-up process by TVC is EMCOREwest.This company is located in the newly established SandiaScience and Technology Park in Albuquerque, and waslaunched in 1998 by Dr Tom Brennan, who is GeneralManager and Vice President of EMCOREwest. Its corebusiness is to manufacture more efficient solar cells foruse in satellites and in other applications. Brennan hasan MS degree in solid-state physics from the StevensInstitute of Technology. After working as a researcherat AT&T Bell Laboratories from 1980 to 1984, and at

Bell Communication Research for two years (1984–1986), Brennan moved to Sandia National Laboratories,where he worked for a decade.

Brennan requested a work assignment in the SmallBusiness Development Office at Sandia National Lab-oratories for one year in order to gain relevant experi-ence in high-tech entrepreneurship. He started MODE(Micro Optical Devices), a laser company, in 1995, nowa division of EMCORE Corporation (in New Jersey).The venture capital for MODE was provided by ArchVenture Corporation, which obtained part of its fundingfrom the New Mexico Investment Corporation. Brennanused the same crystal material (that he had utilized atMODE) for photovoltaic cells of greater efficiency inconverting sunlight to electricity. Brennan sold his own-ership of MODE to the EMCORE Corporation for $19million, and started EMCOREwest in 1996. EMCORE-west had 40 employees in 1999, and was projected toexpand to 400 employees in its second year. Brennaninsisted in his negotiations with the EMCORE Corpor-ation that EMCOREwest should remain in Albuquerque,in order to neighbor with Sandia National Laboratory.

A vision of creating a technopolis in New Mexico hasgradually emerged in the late 1990s, and appropriateorganizations and programs have arisen to facilitate tech-nology transfer. Numerous high-technology spin-offsfrom SNL and LANL and the University of New Mexicooccur in Northern New Mexico, about 20 to 30 annuallyin recent years. Eventually, one of these high-tech spin-offs may become a “home run” and its entrepreneur willserve as a role model for business success, perhaps simi-lar to the role of Michael Dell in Austin, Texas.

8. Lessons learned about technology transfer

We conclude with the following lessons learned abouttechnology transfer, drawn from research in New Mexico:

1. Articles in scientific journal are a relatively ineffec-tive mechanism for technology transfer, although art-icles are one of the main technology transfer activitiesof scientists.

2. Spin-offs are a particularly effective means of tech-nology transfer, leading to job and wealth creation.The rate of such start-ups in a region is relatively slowat first, but then, after a critical mass is reached,becomes self-sustaining and increases exponentially.This critical mass has not yet happened in New Mex-ico, but may lie in the decade ahead.

3. The availability of ample technology in a region is anecessary but insufficient factor in the developmentof a technopolis. Much of the technology from federalweapons laboratories like SNL and LANL is defense-related and thus is difficult to commercialize.

4. Technology transfer facilitating organizations, and

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the favorable entrepreneurial leave policies of federalR&D laboratories like SNL and LANL, are speedingup the process of getting to critical mass in the growthof high-tech spin-offs. The existence of spin-off facili-tating organizations, such as the Albuquerque Tech-nology Incubator, located in the University’s Tech-nology Park, the Lovelace Research InstituteIncubator, the Business Technology Group and TVC,help provide important assistance to entrepreneurs inlaunching spin-offs.

The early beginnings of a technopolis are gettingunderway in Northern New Mexico, but another decademay be required to reach the take-off point in this pro-cess. Meanwhile, New Mexico provides a useful labora-tory in which to gain understandings of the technologytransfer process.

Acknowledgements

The authors express their thanks to the MitsubishiInternational Corporation, San Francisco, for supportingthe present research on technology transfer. The presentpaper was originally presented at the International Con-ference on Technology Policy and Innovation, August30–September 2, 1999, in Austin, Texas.

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261E.M. Rogers et al. / Technovation 21 (2001) 253–261

Everett M. Rogers is Regents’ Professor, in theDepartment of Communication and Journalismat the University of New Mexico. Rogers,known for his bookDiffusion of Innovations(4th ed., 1995), spent the 1999–2000 year onsabbatical leave from the University of NewMexico as a Visiting Professor at the Center forCommunication Programs at Johns HopkinsUniversity.

Shiro Takegami was a Visiting Research Scientist in 1998–1999 in theDepartment of Communication and Journalism at the University of NewMexico (and is a Career Officer in MITI, the Japanese Ministry of Inter-national Trade and Industry). He is presently serving as a technology trans-fer advisor for MITI to the government of Saudi Arabia.

Jing Yin was a Research Assistant, in the Department of Communicationand Journalism at the University of New Mexico. He is currently a doc-toral student in Communication at Pennsylvania State University.